The books/podcasts/blogs mentioned in this article share one thing in common - they help you develop a long term, equity-oriented, well diversified, low-cost, simple investing strategy. Take a moment and think about those five key words. Investing does not have to be complicated. Developing a systematic and disciplined mindset and sticking to the plan is the tough thing to do! So believe in yourselves and begin your journey to financial independence. Enough of pep talk... Here are few resources that I have found extremely helpful. The authors have done a commendable job of explaining basic concepts of personal finance and investing in the most simplest terms. The topics are well organized and easy to digest.
Books
The Simple Path to Wealth by J L Collins - in my opinion, this is the simplest book out there on investing. Collins wrote series of letters in 2011 to his daughter about money and investing. He later started a blog www.jlcollinsnh.com and created Stock Series to discuss topics on sound investing.
Retire before Mom and Dad by Rob Berger - in this book Rob beautifully explains the power of compound interest and discusses The 7 Levels of Financial Freedom and how to achieve it. The message in the book encourages you to change the way you look at money and use the money to buy your financial freedom instead of buying things you don't need, with the money you don't have, to impress the people you don't like.
I Will Teach You To Be Rich by Ramit Sethi - Ramit directly cuts to the chase and nails every topic from optimizing your credit cards and bank accounts to investing and automating your finances. He also offers tips and scripts on how to negotiate your salary/raise, pay less in fees by negotiating with your bank and credit card companies. Ramit explains that all of us can live our rich lives by spending extravagantly on things we love by ruthlessly reducing our expenses on things we do not need.
The Little Book of Common Sense Investing by John C. Bogle - Mr. Bogle, the founder and former chairman of The Vanguard Group, created the first index fund in 1975 that started index investing revolution. In this book, Mr. Bogle explains how investing in index funds can effectively guarantee your fair share of stock market returns. Index funds are low cost investing vehicles compared to many actively managed funds that charge high fees whose managers are seldom able to beat the market consistently over a longer horizon. To emphasize the genius of Mr. Bogle, I would like to quote Warren Buffet who supports index investing and said this about Mr. Bogle: "If statue is ever erected to honor the person who has done the most for American investors, the hands-down choice should be Jack Bogle."
A Random Walk Down Wall Street by Burton G. Malkiel - in this book the author underscores that passively invested portfolio of low-cost, well diversified index of securities is still likely to exceed the performance of actively managed funds. Mr. Malkiel also talks about the recent bubble in cryptocurrencies like bitcoin. In addition, he explains how you can leverage other investing vehicles like money market accounts, real estate investment trusts (REITs), insurance, home ownership, gold and collectibles and use tax-loss harvesting to your advantage.
The Intelligent Investor by Benjamin Graham - This is a Classic! The book discusses the philosophy of "value investing". The book was first published in 1949. This is one book you don't was to miss reading! Graham's investing principles are still current in today's modern world. Doing your due-diligence of the company and its underlying businesses, shielding yourselves from big losses and aspiring for adequate returns are Graham's key principles on investing.
Your Money or Your Life by Vicki Robin and Joe Dominguez - What is your relationship with money? How much of your life's energy do you trade for money? Are you at peace with your money? These are some of the deep questions that the authors address in their book. Our beliefs, habits, play an important role in the way we manage our money. This books presents tools/lessons to achieve four FIs: Financial Intelligence, Financial Integrity, Financial Independence and Financial Interdependence.
Blogs and Podcasts
There are a lot of blogs out there with good saving, investing and money management advice. Some of these folks have retired early in their life to dedicate their time and energy to share knowledge and help others achieve financial independence.
Mr. Money Mustache - blog by Peter Adeney. There is also an app
Afford Anything - blog and podcast by Paula Pant
The Dough Roller Money Podcast - podcast by Rob Berger
madfientist.com
jlcollinsnh.com
bogleheads.org
Other Books
If this topic has spiked your interest and you would like to explore more, here are some additional books that you may want to read:
- Unconventional Success: A Fundamental Approach to Personal Investment by David F. Swensen
- The Bogleheads' Guide to Investing - by Taylor Larimore, Mel Lindauer, Michael LeBoeuf
- When Genius Failed: The Rise and Fall of Long-Term Capital Management by Roger Lowenstein
- The Millionaire Next Door by Thomas J. Stanley, William D. Danko
Once you take the first step to read and learn basics of personal finance, you will know where to start and will feel in control. Next time when you hear words like portfolio, bull/bear market, equity, risk/return, diversification, asset allocation you won't be puzzled. Instead, you will know enough to have meaningful conversations with your friends and family. Also, if you have hired a financial manager, you will be able to ask the "right" questions and make sure your financial manager is working in your best interest. So Read On...! And remember... Every Cent you put to good use, has a ton of Potential to grow.
